INEOS to source US shale ethane for European cracker feedstock

The company has agreed to a 15-year deal with Range Resources to take Marcellus Shale ethane from the Marcus Hook facility in Pennsylvania, beginning in 2015.

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INEOS Europe on Thursday said it completed supply and
infrastructure agreements that will secure a significant volume
of ethane feedstock from the US, for use in
its European cracker complexes.

The company has agreed to a long-term deal with US-based Range
Resources for the lifting of ethane from the Marcus Hook
facility in Pennsylvania, starting in 2015.

The Marcus Hook site was formerly a Sunoco refinery and is now being used as a
terminal, operated by Sunoco Logistics Partners.

The agreement is effective upon Federal Energy Regulatory
Commission (FERC) approval of the Mariner East project.

The supply deal with Range Resources complements our
portfolio of feedstock agreements for our
European crackers and will strengthen our competitive position
as an ethylene producer in Europe for the foreseeable
future, said David Thompson, procurement and supply chain
director at INEOS Olefins & Polymers Europe.

INEOS also finalized pipeline transportation services and
terminal services agreements for the shipping of ethane from
western Pennsylvania to Marcus Hook with subsidiaries of
Sunoco.

The agreements will be valid for 15 years and will provide
INEOS Olefins & Polymers Europe with significant supply
options for the future, according to the company.

It is expected that when completed, the Mariner East project will transport approximately
70,000 bpd of ethane and propane from Houston, Pennsylvania, to
the Marcus Hook terminal facilities.

Ethane will then be separated by fractionation and held in
storage ready for shipment to Europe. It is expected that
ethane from the Mariner East project will become available during
the first half of 2015.

INEOS can now position itself as an attractive
customer for upstream companies with interests in the
Marcellus, Utica and Upper Devonian gas formations, said
Thompson.

We will provide these companies with a credible option
to diversify sales and supply ethane into our downstream
cracker complexes in Europe.

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